DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT: INSTITUTE A CONSOLIDATED BUDGET PROCESS

2-E
DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT: INSTITUTE A CONSOLIDATED BUDGET PROCESS

 

Problem Identification:
HABC does not prepare a comprehensive budget for board review that includes all funding sources and all programs. Without a comprehensive budget, it is extremely difficult to understand the true cost of any program or activity since such functions may be funded through multiple sources. In FY2000, HABC faced a budget deficit of $8 million, and HCD owed $15 million of borrowed Community Development Block Grant (federal) funds.

Recommended Action:
Establish an annual, consolidated budgeting process that examines all agency sources and uses.

Classification:
Organizational

Functional/Operational Area:
HABC/Financial Management

Estimated Annual Impact:
Improved financial accountability.

Estimated Implementation Costs:
None

Barriers to Implementation:
None

Projected Implementation:
90 days

Next Steps:
Conduct a series of ‘board workshops’ wherein the board can understand the different sources and uses of agency funds. Train staff where appropriate.

Analysis:
Consistent with this recommendation, HABC should prepare regular monthly income/expense reports, with accompanying narrative explanations of variances, for each major program/fund. This recommendation assumes the creation of a CFO position, without which the institution of a consolidated budget process would be difficult (see Recommendation 1A – 1-E).